Governor Brown signed into law the nation's toughest protections for homeowners facing foreclosure. Much of the national mortgage settlement agreed to by five banks earlier this year now apply to all mortgage providers doing business in California and make the terms permanent. "I find it almost incomprehensible that so many smart people and so many rich people could screw things up so profoundly and cause so much suffering and get off in many cases," Brown said.

Beginning January 1, the Homeowner Bill of Rights will:

Ban "dual-tracking" (which is when banks pursued foreclosure even though the homeowner was seeking a loan modification)

The California Bankers Association is concerned about the potential spike in litigation. "If you mess with the process and the markets, that could increase the costs for future homebuyers," California Bankers Association spokesperson Beth Mills said.

The state Attorney General estimates about 700,000 Californians are in the foreclosure pipeline right now. Because the law doesn't take effect for another five months, it's unclear whether the new law can help them, but troubled homeowner Merrie Jo Musni of San Francisco is excited about the possibility of having one point of contact at the bank because she's already dealt with six. "I've been diagnosed with high blood pressure, something my family doesn't have. The stress is incredible," she said.

And lawmakers are not done. They're working on giving renters more protections if their rental is in foreclosure and letting non-profits have first dibs in buying a foreclosed home.